The Ministry of Finance of Indonesia officially announced the postponement of the implementation of the new vendor tax mechanism, originally scheduled for 2025, to 1 February 2026, which involved vendors on mainstream platforms such as Shopee, Tokopedia, Bukalapak, Blibli and Lazada.
The new mechanism, under the Minister of Finance Regulation issued on 14 July, imposes an income tax of 0.5 per cent on Article 22, which does not add to the existing 11 per cent value added tax (PPN), on vendors of electric power company platforms with an annual turnover of more than 500 million guilders (approximately $33,000). The tax is independent of VAT and the Platform is responsible for deductions. Platforms such as Shopee and Tokopedia will automatically deduct taxes from the vendor ‘ s settlement and declare and pay taxes to the General Tax Administration (DJP) on a monthly basis, with a complete exemption for small and medium-sized vendors with annual turnover of less than 500 million guilders. Bimo Wijayanto, Director General of Tax Administration, Ministry of Finance, emphasized that the design “simplified tax processes and improved compliance efficiency”, and expected to cover over 80 per cent of platform vendors.
The tax changes planned to take effect on 1 July 2025 had given rise to industry concerns: the Indonesian Electrician Association (IDEA) estimated that about 30 per cent of small and medium-sized vendors might face additional cost pressures, indirectly pushing up commodity prices by 5 to 10 per cent. According to the Government, this was intended to increase tax compliance and simplify the filing process, but was suspended in order to avoid shocks to residents ‘ purchasing power and to ease the burden on small and medium-sized vendors. After a delay of February 2026, the Government will use the buffer period to optimize the system interface to ensure that the platform is seamlessly connected to the API and avoid “technical gaps”. The Indonesian Minister of Finance, Sri Mulyani Indrawati, stated: “We give priority to economic growth and consumer welfare, and tax changes will be carried forward in tandem with the law of the digital economy”. The tax reform of Indonesia’s electricians originated in the digital economy in 2024: The country has more than 200 million electric power users, an increase of 25 per cent in GMV in the first half of 2024, but the tax compliance rate is only 60 per cent and the shadow economy is over 1 trillion guilders. As early as June 2024, the Ministry of Finance initiated a new draft regulation aimed at closing the “tax leakage” through platform closures, similar to the EU Digital Services Tax (DST). Following the issuance of the regulation on 14 July, platforms such as Hopee and Tokopedia responded quickly by developing prototype tests of the tax module.
However, economic data for the first half of 2025 “redlighted”: inflation in Indonesia rose to 4.2 per cent, consumer spending fell by 2 per cent each year, and the profit margin for small and medium-sized vendors (90 per cent of the platform) fell to less than 5 per cent. The Government’s assessment decided to postpone it, similar to the “progressive” approach at the 2023 VAT increase. For small and medium-sized sellers, the delay was “timely rain”: the President of the Indonesian Electrician Association estimated that a tax change in 2025, if it landed as planned, would increase the industry’s cost by about 5 trillion guilders, some of which were either forced to raise prices or withdraw.
